NARNIA

Jump to: Overview | Research pillars | Expected contribution | Funding

Overview

The NARNIA project will develop a unified framework to assess the socio-economic consequences of nature degradation and identify suitable policy actions that ensure the stability of economic systems while aligning with ecosystem preservation.

The accelerating impacts of climate change and the degradation of ecosystems present a dual crisis that threatens human survival and the sustainability of economic activities. While climate change has gained significant attention, the alarming pace at which nature and the services it provides are degrading poses equally critical risks. Environmental degradation deeply affects human activities, propagates through economic and financial networks, and builds up systemic financial distress. Economic and financial actors are unprepared to assess and mitigate these risks, revealing a critical gap in quantitative modelling, scenario-based risk assessment, and nature-aligned policy design.

NARNIA addresses these challenges by developing an integrated macro-financial framework that quantifies how nature-related risks percolate through economic and financial systems. It brings together insights from earth system science, economics, sustainable finance, integrated assessment, and agent-based modelling in a coherent manner.

Research pillars

Expected contribution

The project will deliver new evidence on two under-investigated aspects of nature-related risks:

• Transmission. How environmental degradation transmits through economic and financial networks, leading to systemic vulnerabilities.
• Policy. How macroeconomic and regulatory policies can safeguard economic stability while supporting global nature restoration targets, such as those envisioned by the Kunming-Montreal Global Biodiversity Framework.